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256B.438 IMPLEMENTATION OF A CASE MIX SYSTEM.
    Subdivision 1. Scope. This section establishes the method and criteria used to determine
resident reimbursement classifications based upon the assessments of residents of nursing homes
and boarding care homes whose payment rates are established under section 256B.431, 256B.434,
or 256B.435. Resident reimbursement classifications shall be established according to the 34
group, resource utilization groups, version III or RUG-III model as described in section 144.0724.
Reimbursement classifications established under this section shall be implemented after June 30,
2002, but no later than January 1, 2003. Reimbursement classifications established under this
section shall be implemented no earlier than six weeks after the commissioner mails notices of
payment rates to the facilities.
    Subd. 2. Definitions. For purposes of this section, the following terms have the meanings
given.
(a) Assessment reference date. "Assessment reference date" has the meaning given in
section 144.0724, subdivision 2, paragraph (a).
(b) Case mix index. "Case mix index" has the meaning given in section 144.0724,
subdivision 2
, paragraph (b).
(c) Index maximization. "Index maximization" has the meaning given in section 144.0724,
subdivision 2
, paragraph (c).
(d) Minimum data set. "Minimum data set" has the meaning given in section 144.0724,
subdivision 2
, paragraph (d).
(e) Representative. "Representative" has the meaning given in section 144.0724, subdivision
2
, paragraph (e).
(f) Resource utilization groups or rug. "Resource utilization groups" or "RUG" has the
meaning given in section 144.0724, subdivision 2, paragraph (f).
    Subd. 3. Case mix indices. (a) The commissioner of human services shall assign a case mix
index to each resident class based on the Centers for Medicare and Medicaid Services staff time
measurement study and adjusted for Minnesota-specific wage indices. The case mix indices
assigned to each resident class shall be published in the Minnesota State Register at least 120 days
prior to the implementation of the 34 group, RUG-III resident classification system.
(b) An index maximization approach shall be used to classify residents.
(c) After implementation of the revised case mix system, the commissioner of human
services may annually rebase case mix indices and base rates using more current data on average
wage rates and staff time measurement studies. This rebasing shall be calculated under subdivision
7, paragraph (b). The commissioner shall publish in the Minnesota State Register adjusted case
mix indices at least 45 days prior to the effective date of the adjusted case mix indices.
    Subd. 4. Resident assessment schedule. (a) Nursing facilities shall conduct and submit case
mix assessments according to the schedule established by the commissioner of health under
section 144.0724, subdivisions 4 and 5.
(b) The resident reimbursement classifications established under section 144.0724,
subdivision 3
, shall be effective the day of admission for new admission assessments. The
effective date for significant change assessments shall be the assessment reference date. The
effective date for annual and quarterly assessments shall be the first day of the month following
assessment reference date.
(c) Effective October 1, 2006, the commissioner shall rebase payment rates to account for
the change in the resident assessment schedule in section 144.0724, subdivision 4, paragraph (b),
clause (4), in a facility specific budget neutral manner, according to subdivision 7, paragraph (b).
    Subd. 5. Notice of resident reimbursement classification. Nursing facilities shall provide
notice to a resident of the resident's case mix classification according to procedures established by
the commissioner of health under section 144.0724, subdivision 7.
    Subd. 6. Reconsideration of resident classification. Any request for reconsideration of a
resident classification must be made under section 144.0724, subdivision 8.
    Subd. 7. Rate determination upon transition to RUG-III payment rates. (a) The
commissioner of human services shall determine payment rates at the time of transition to the
RUG based payment model in a facility-specific, budget-neutral manner. The case mix indices
as defined in subdivision 3 shall be used to allocate the case mix adjusted component of total
payment across all case mix groups. To transition from the current calculation methodology to
the RUG based methodology, the commissioner of health shall report to the commissioner of
human services the resident days classified according to the categories defined in subdivision
3 for the 12-month reporting period ending September 30, 2001, for each nursing facility. The
commissioner of human services shall use this data to compute the standardized days for the
reporting period under the RUG system.
(b) The commissioner of human services shall determine the case mix adjusted component
of the rate as follows:
(1) determine the case mix portion of the 11 case mix rates in effect on June 30, 2002, or the
34 case mix rates in effect on or after June 30, 2003;
(2) multiply each amount in clause (1) by the number of resident days assigned to each group
for the reporting period ending September 30, 2001, or the most recent year for which data is
available;
(3) compute the sum of the amounts in clause (2);
(4) determine the total RUG standardized days for the reporting period ending September
30, 2001, or the most recent year for which data is available using the new indices calculated
under subdivision 3, paragraph (c);
(5) divide the amount in clause (3) by the amount in clause (4) which shall be the average
case mix adjusted component of the rate under the RUG method; and
(6) multiply this average rate by the case mix weight in subdivision 3 for each RUG group.
(c) The noncase mix component will be allocated to each RUG group as a constant amount
to determine the transition payment rate. Any other rate adjustments that are effective on or after
July 1, 2002, shall be applied to the transition rates determined under this section.
History: 1Sp2001 c 9 art 5 s 28; 2002 c 277 s 32; 2002 c 375 art 2 s 41; 2002 c 379 art 1 s
113; 2006 c 282 art 20 s 26